Behind the Billboards : The DOOH Predicament

This is MAGNA's global OOH Map with a %age market share of DOOH.

A cursory look at the numbers, we have Brazil, the UK, and Australia at over 30% but the total OOH market size is between less than half a billion $ to 1.5b$. Peru with a $28m total market size has a higher DOOH allocation.

China, South Korea, the Philippines, Hong Kong, and Chile have allocated around 20 %age points. Seemingly, all good numbers.

Each market seems to have some characteristics that are inherent to them. DOOH is subjected to a lot of local laws that are ununiform across various geographies. Also, a lot of DOOH media is in private or quasi-public areas and should not be considered a part of OOH, but it is.

This report was from 2016 when the world was looking up and President Trump had started to run it.

From there on the world of DOOH was supposed to grow like this -

and the US of A, like this

The latest chart takes COVID into account and for good or bad, mostly good, the US economy is the precursor to the world's.

Look harder or softer at the numbers, one thing is clear - DOOH is insignificant in the larger scheme of things. Some observations,

Push Product

Advertisers are not asking for DOOH, publishers or media owners are pushing for it. Almost every event is sponsored by mostly Chinese manufacturers. Where a representative of some third party data company and recently fired executive, get together with directory magazine - the one where you have advertorials and advertisements and no serious editorial content.

Expensive Infrastructure

DOOH is a connected medium and needs utility infrastructure to display effectively. There is a preservatory cost associated with it. It is not about a vinyl screen getting torn and to be replaced. Everything is expensive from the need to have a constant connection to a set of trained manpower next to the deployment.

Pilferage and damage costs do get added.

Oversupply of media

Advertisement is a perishable medium and DOOH creates an oversupply of media. Where you had one spot to sell, you have multiple slots. It makes sense in certain key areas, where demand outstrips supply but those locations can be counted using fingers, knuckles, and toes for the whole wide world.

Low Return on Investment

The whole exercise becomes expensive and for a brand, unless there is some long-tail they are chasing, it is totally not worth it.

A billboard in the same area would cost less and provide more exposure for lesser the amount spent.

....and with Out-of-home industry suffering

No industry has suffered more during the pandemic, and I am not talking only about advertising. It does not make any economic sense to increase supply, when you have over half-sold inventory priced below subsistence level.

Additionally DOOH suffers from the same ills with reliance on third-party data techniques, lack of transparency, and compliance.

Digital out-of-home (DOOH) is basically OOH powered up with AdTech – geofencing, tracking, retargeting, personalizing, attribution and measurement.

If you are an industry insider you are aware that none of the above is happening on the ground. Available data is either extrapolated or sourced.

Epilogue

For all its benefits, and I am sure there are many, DOOH in its present form is less about consumer demand. There is no pull factor for it. Brands and advertisers are not demanding it. Media owners in a bout of FOMO (fear of missing out) have invested in one or two marquee digital signboards but they have privately confessed to the futility of it.

DOOH is more of an outlier and cannot be the bulwark that will help with the digital onslaught that the Out-of-home advertising industry is facing.

All the brouhaha about DOOH, is just brouhaha.